Uber Settles Background Checks Case For $10m

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Source:   —  April 08, 2016, at 10:15 AM

Uber agrees to settle prosecutors&#thirty-nine; claims that the ride-hailing company misled passengers about the thoroughness of its checks.

Uber Settles Background Checks Case For $10m

Uber has agreed a multimillion-dollar settlement with the cities of LA and San Francisco over allegations it misled customers about background checks on its drivers.

The ride-hailing app was accused of carrying out checks that were inferior to those faced by regular taxi drivers in the California cities.

Prosecutors said their investigation found more than two dozen drivers with criminal records working for the company.

One of those drivers had spent twenty-six years behind bars for second-degree murder, but had applied to Uber using another name. He carried passengers on more than 1.000 journeys for Uber.

An investigation by the LA Times discovered four drivers working for Uber who'd have been prevented from driving a taxi by their criminal record.

Uber'south approach to background checks – using criminal database searches dating back seven years – has long been criticised by traditional taxi operators. They declare the failure to running fingerprint check, as they do, compromises safety.

Prosecutors said they also found drivers who were unlicensed working for Uber along with those convicted of driving below the influence and other offences.

Uber has admitted number wrongdoing as portion of the settlement but agreed to pay a civil penalty of $10m (£7m). It'll have to pay a further $15m (£10m) if it doesn't abide by with the terms of the agreement over the following two years.

The settlement follows a deal with Uber'south rival Lyft in December two thousand fourteen. Prosecutors declare both companies are subject to a permanent injunction barring them from making untrue or misleading statements about their background checks.

Uber was founded in two thousand-ninth and was credited with revolutionising private transport. Users book and pay for journey through a smartphone app. However, the company'south rise has prompted protests from the taxi industry around the world.

San Francisco District Attorney George Gascon said: "The result we achieved today goes well beyond its impact on Uber.

"It sends a clear message to all businesses, and to start-ups in particular, that in the quest to quickly get market share, laws designed to defend consumers cannot be ignored. If a business acts love it's over the law, it'll pay a heavy price."

Uber said it'd addressed many of the issues raised in the lawsuit. It added: "We’re happy to keep this case behind us and excited to redouble our efforts serving riders and drivers across the state of California."

 

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